Calcutta High Court (Appellete Side)
The West Bengal Small Industries … vs M/S. Twinstar Industries And Others on 19 March, 2026
Author: Supratim Bhattacharya
Bench: Sabyasachi Bhattacharyya, Supratim Bhattacharya
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In the High Court at Calcutta
Civil Appellate Jurisdiction
Appellate Side
The Hon'ble Mr. Justice Sabyasachi Bhattacharyya
And
The Hon'ble Mr. Justice Supratim Bhattacharya
M.A.T. No. 1694 of 2024
IA No: CAN 1 of 2024
with
M.A.T. No. 1695 of 2024
IA No: CAN 1 of 2024
The West Bengal Small Industries Development Limited and Others
Vs.
M/s. Twinstar Industries and Others
For the appellants : Mr. Kamal Kr. Chattopadhyay,
Mr. Mahendra Gupta,
Ms. Rimi Chatterjee,
Mr. Abhisekh Sikdar,
Ms. Moumita Dhar,
Ms. Saheli Dey
For the respondents : Mr. Srijib Chakraborty,
Mr. Aditya Mondal
Heard on : 12.02.2026, 26.02.2026
& 10.03.2026
Reserved on : 10.03.2026
Judgment on : 19.03.2026
Sabyasachi Bhattacharyya, J.:-
1. The West Bengal Small Industries Development Corporation Limited
(WBSIDCL) and others have preferred the present appeals against a
common judgment dated August 16, 2024 passed in two writ petitions,
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being WPA 4280 of 2014 and WPA 22402 of 2024, setting aside an order
of eviction dated July 19, 2023 passed by the Prescribed Authority,
WBSIDCL against the writ petitioners/respondent nos. 1 and 2 and
directing the WBSIDCL to renew and convert the short-term lease of the
respondent no. 1 to long-term lease of 99 years pertaining to the
application of the petitioners in this regard dated January 10, 2023 and
to extend the benefits of two schemes floated by the WBSIDCL in favour
of the petitioners in respect of Plot nos. K-10 and K-10/2, Behala
Industrial Estate at 620, Kolkata-700 034 as well as to restore
possession of the aforesaid plots to the writ petitioners/respondent nos.
1 and 2.
2. Respondent no. 1 is a proprietorship firm of the respondent no. 2,
running its industry from the said plots.
3. The turn of events leading to the present litigation are as follows:
4. A lease of nine years was granted on June 8, 1989 by the WBSIDCL in
favour of the respondent no. 1 in respect of the subject-plots, which
expired on August 8, 1998. The appellants allege that the respondent no.
1, even prior to the expiry of the lease, was a defaulter in payment of
lease rent.
5. On May 3, 2013, a notice of eviction was issued under Section 3(1) of the
West Bengal Government Premises (Tenancy Regulation) Act, 1976
(hereinafter referred to as “the 1976 Act”). An appeal having been
preferred by the respondent nos. 1 and 2, the Appellate Authority passed
an order on August 8, 2013 directing the respondent no. 1 to pay the
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arrear rent, out of which Rs. 4 lakh was to be deposited by August 16,
2013 and the balance of Rs.2,26,000/- by September 16, 2013. The
respondent no. 1 deposited Rs.3,26,140/- on August 8, 2013.
Subsequently, the Appellate Authority extended the time for payment of
the balance dues on October 9, 2013 and December 13, 2013
respectively. Ultimately, an order of resumption under Section 4(2) of the
1976 Act was issued by the appellants against the respondent no. 1 on
January 28, 2014.
6. A writ petition, being WPA 4280 of 2014, was preferred by the
respondent nos. 1 and 2 against the said order of eviction, in which an
order restraining the appellants from evicting the respondent nos. 1 and
2 was passed on March 25, 2014, on condition of payment of the rent
dues. On March 28, 2014, the said dues were paid by the said
respondents in terms of the above order. Thereafter, respondent no. 1
requested the appellant-Authorities for monthly rent bills from April,
2014 by a written communication dated May 5, 2014.
7. On February 18, 2021, the WBSIDCL issued a Scheme by Circular No.
SB-1/2896/10/2020-21, which was further extended for 180 days vide
Circular no. SB/1/1468/2022-23 dated August 25, 2022. Under the
said Scheme, the existing allottees of the plots in the said industrial
estate were granted an opportunity, upon payment of arrear rents, to
have their short-term lease deeds renewed and converted to long-term
leases.
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8. The respondents applied for getting the benefit of the said Scheme on
January 10, 2023.
9. Subsequently, on June 21, 2023, WPA 4280 of 2014 got dismissed for
default. On July 19, 2023, a second resumption order under Section 4(2)
was passed by the appellant-authorities, against which a representation
was given on July 25, 2023 by the respondent nos.1 and 2. The said
respondents were heard on the same on August 31, 2023. However, vide
order dated September 1, 2023, the said representation was rejected by
the appellants.
10. Subsequently, on September 11, 2023, a notice was issued by the
appellant to the said respondents fixing September 14, 2023 (11 AM) for
resumption of possession.
11. On September 14, 2023 itself, respondent nos. 1 and 2 filed a writ
petition being WPA 22402 of 2023 and served a copy thereof on the
appellants, indicating that the matter would be taken up at 2 PM by the
concerned Bench. On the self-same date, when the matter was taken up
for hearing, the Court was informed that possession of the said plots had
already been taken by the appellants, upon which the learned Single
Judge was pleased to pass an order restraining the appellants from
creating third party encumbrances and to direct the arrears of rent till
March 1, 2023, as quantified by the appellants at Rs. 5,50,201/-, to be
deposited by respondent nos. 1 and 2. On September 15, 2023, such
amount was deposited by the said respondents.
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12. Subsequently, on August 16, 2024, WPA 4280 of 2014 was taken up for
hearing along with WPA 22402 of 2023 and the said writ petitions were
disposed of by passing the judgment and order impugned in the present
appeals.
13. Learned counsel appearing for the appellants argues that upon expiry of
the lease deed of respondent no.1 on August 8, 1998, the said
respondent lost its right of possession. The subsequent orders under
Section 4(2) of the 1976 Act for resumption of possession were merely in
furtherance of the eviction order passed under Section 3(1) of the said
Act on May 3, 2013.
14. Due to subsistence of the order of stay passed initially in WPA 4280 of
2014, resumption could not take place. Upon the said writ petition being
dismissed for default on June 21, 2023, the second resumption order
was passed and a notice for taking possession was also issued to the
respondent nos. 1 and 2, specifically intimating them that possession
would be taken on September 14, 2023 at 11 am. Thus, it is submitted
that there was no irregularity in such resumption, since no stay order
was subsisting at that point of time and due process of law had been
followed.
15. Learned counsel for the appellants further contends that respondent
nos. 1 and 2 did not comply with the requirements of the statute by
applying in time for renewal and depositing therewith arrears of rent and
interest thereon. Thus, there was no question of renewal of the lease of
respondent no. 1 at any point of time.
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16. It is further argued that the respondent no.1 was not entitled to the
benefit of the Scheme dated February 18, 2021, subsequently extended
on August 25, 2022, since the said respondent was not an “existing
allottee” upon the expiry of its lease. Secondly, the Scheme contemplated
an application to be filed for getting the benefit of the same within 30
days with accompanying deposit of all outstanding arrears of rent.
Moreover, as a pre-condition of the Scheme, there could not be any
pending litigation. None of the said conditions were, however, complied
with by respondent no. 1. Thus, it is submitted that respondent no. 1
was never entitled to get the benefit of the Scheme.
17. Addressing the Court on an unreported judgment of this Court in
Continental Chemical Corporation v. West Bengal Small Industries
Development Corporation Limited and Ors. (WPA No. 183 of 2024), it is
submitted that in the said case, there was a direction of the Division
Bench on the WBSIDCL to consider the case of the writ petitioner
therein; furthermore, draft deeds had been exchanged several times
between the parties and were approved by the authorities. Thus, the
question of res judicata was taken into consideration, Furthermore, there
was an order directing the writ petitioner to comply with the Managing
Director‟s order to have the lease deed registered in its favour. Hence, the
context was different than the present case in Continental Chemical
Corporation (supra)1.
1
Continental Chemical Corporation v. West Bengal Small Industries Development
Corporation Limited and Ors. (WPA No. 183 of 2024)
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18. In the case of M/s. Gravo Prints, which was given the benefit of the
Scheme, which is cited by respondent nos. 1 and 2 for the purpose of
claiming similar relief, it is contended by the appellants that the said
entity had continued to pay monthly rent and had applied for renewal of
lease on March 25, 2012, that is, within time. The prayer for renewal was
all along pursued and the renewal and conversion offer was subsisting
till 2018. After the Scheme was introduced, it was availed of by M/s.
Gravo Prints and accordingly the appellant authority passed an order
allowing it to pay the arrear amounts of rent and consequently, a long-
term lease deed was executed in its favour. However, it is submitted that
in the present case, respondent no. 1 never exercised its right of renewal,
nor made payment of arrear rents along with the application filed for
getting the benefit of the Scheme. That apart, a valid eviction order was
passed under Section 3(1) of the 1976 Act and resumption occurred
under Section 4 thereof. Hence, it is argued that M/s. Gravo Prints stood
on a different footing that respondent no. 1 and the latter cannot claim
parity with M/s. Gravo Prints insofar as the grant of the benefit of the
Scheme is concerned.
19. The appellants rely on an unreported judgment of the Supreme Court in
the matter of West Bengal Small Industries Development Corporation Ltd.
& Ors. v. M/s. Sona Promoters Pvt. Ltd. & Ors. passed in Civil Appeal No.
2201 of 2020, where the Hon‟ble Supreme Court was pleased to observe
that the eviction proceedings initiated by the WBSIDCL under the 1976
Act was without jurisdiction, since the subject-plots did not satisfy the
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requirements of the definition of “Government premises” within the
meaning of Section 2(a), read with Section 2(c), of the said Act and that
proceedings were initiated under the West Bengal Public Land (Eviction
of Unauthorized Occupants) Act, 1962. However, in the present case,
there is no dispute regarding the 1976 Act being applicable.
20. Learned Counsel for the appellants next cites Deepak Kejriwal v. The
State of West Bengal and others (WPO No. 518 of 2013), a Single Bench
Judgment of this Court, where the Court held that in absence of any
agreement for fructifying the proposed renewal of any lease deed between
the parties, there could not be any occasion to renew the lease. It was
further observed that merely by acceptance of the occupation charges on
calling it “rent”, as the writ petitioner therein continued its
accommodation, does not amount to a renewal of the lease between the
parties since there was no consensus ad idem between the parties.
21. Learned counsel next cites Gulshan Kumar Gulati and Another v. West
Bengal Small Industries Development Corporation Limited and others
(WPO No. 1610 of 2023), where this Court had observed that an eviction
order dated November 2, 2012 passed in a proceeding under the 1976
Act was implemented by eviction, which was justified. The objection as to
inherent lack of jurisdiction of the concerned authority was turned down
since the writ petitioners therein had participated in the proceedings
under the 1976 Act.
22. It is argued that the contention of respondent nos. 1 and 2 that there
was “legal malice” on the part of the appellant-authorities is not tenable,
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since the appellants adopted due process of law in passing the eviction
order and having it implemented by resumption of possession against
the respondent no. 1, whose lease had expired by efflux of time and also
by virtue of the notice under Section 3(1) of the 1976 Act since the
respondent no. 1 was a defaulter in payment of rent. It is argued that the
resumption order was not required to be supported by detailed reasons
since it was merely in furtherance of the eviction order and was within
the statutory powers of the appellants to pass.
23. Learned counsel for respondent nos. 1 and 2, on the other hand, argues
that despite the expiry of the lease, respondent no. 1 remained a tenant
in respect of such plots, since the appellant-authorities continued to
receive rent from them even after such expiry.
24. Moreover, it is contended that even after the order of eviction was passed
under Section 3(1) of the 1976 Act, respondent no. 1 continued to pay
substantial amounts of arrears of rent at various point of time, for
instance Rs. 3,26,000/- on August 8, 2013 and Rs. 3,50,000/- on March
28, 2014, which were duly accepted by the appellant-authorities.
25. It is thus argued that there was substantial compliance of the provisos to
section 3(2) of the 1976 Act, which learned counsel for respondent nos. 1
and 2 seeks to equate with the beneficial provisions under Section 7 of
the West Bengal Premises Tenancy Act, 1997 and Section 17 of its
predecessor statute of 1956.
26. Learned counsel for respondent nos. 1 and 2 next argues that on May 5,
2014, the said respondent had sought issuance of rent bills after clearing
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its dues, thus, in effect, expressing its intention to have the lease
renewed. Hence, it cannot be said that there was no renewal application
as such from the respondent no. 1. If the rent bills were issued by the
appellants in terms of such request, there would not be any occasion for
respondent no. 1 to make further defaults. The appellants, it is argued,
cannot take advantage of their own wrong by sitting tight over such
request for issuing rent bills on the one hand and alleging absence of any
prayer for renewal of lease by the contesting respondents on the other.
27. Learned counsel for the contesting respondents next argues that M/s.
Gravo Prints were given the benefit of the Scheme-in-question despite
being a defaulter, although its lease had expired due to efflux of time at
the relevant juncture. In spite of the same, it was treated as an „existing
allottee‟ for the purpose of the Scheme by the appellants and given the
benefit of the Scheme by converting its lease deed to a long-term lease.
28. It is contended that the 1976 Act and the Scheme floated by the
appellant-authorities are beneficial in nature and, as such, ought to be
construed in favour of the beneficiaries. Respondent no. 1 applied within
the extended time stipulated in the Scheme; thus, there could not be any
bar to grant its benefit to respondent no. 1.
29. As regards the clauses in the Scheme contemplating that there should be
no pending litigation and all arrear of rents should be paid, it is
submitted that those were not preconditions of making an application to
get the benefit of the Scheme. It is argued that even after making an
application, upon a calculation of the arrears of rent being furnished by
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the appellants, the duty to pay such rent would be cast on the applicant.
Again, only upon the application being sanctioned in principle could
there be any occasion for withdrawal of all pending litigations. Thus, it is
contended that by not granting the benefit of the Scheme to respondent
no. 1, whereas such benefit was extended to M/s Gravo Prints, which
stood on similar fooring, the appellants squarely violated Article 14 of the
Constitution of India. Learned counsel for respondent nos. 1 and 2 also
relies on other instances where similar benefit of the Scheme was given
to allottees whose leases had expired long prior thereto.
30. Learned counsel for respondent nos. 1 and 2 further argues that the
action of the respondent no. 1 was tainted by “legal malice”. Despite the
request of respondent no. 1 for issuance of rent bills, which
tantamounted to expressing intention of renewal of the lease, and the
pendency of the application filed by the respondent no. 1 to get the
benefit of the Scheme, the appellant-authorities, without disposing of the
same, proceeded to pass a further resumption order under Section 4(2)
of the 1976 Act immediately after WPA 4280 of 2014 was dismissed for
default.
31. Legal malice was further manifest in the appellants‟ bid to oust
respondent nos. 1 and 2 from possession of the subject plots on the very
day when the subsequent writ petition, being WPA 22402 of 2024, was
moved before a learned Single Judge of this Court, despite a copy of such
writ petition and notice of moving the same at 2 pm on the date of
dispossession being given to the appellants, without waiting for the
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outcome of the said writ petition. Thus, it is argued that the acts of the
appellants were vitiated by palpable arbitrariness, which comes clearly
within the category of legal malice.
32. Learned counsel cites State of A.P. and others v. Goverdhanlal Pitti,
reported at (2003) 4 SCC 739, for the above proposition. In the said case,
the Hon‟ble Supreme Court observed that legal malice on the part of the
State should be understood to mean that the action of the State is not
taken bona fide for the purpose of the Land Acquisition Act and it had
been taken only to frustrate the favourable decisions obtained by the
owner of the property against the State in the eviction and writ
proceedings.
33. Learned counsel places reliance on Continental Chemical Corporation
(supra)2, where the court held that the writ petitioner therein was to be
given the benefit of the Scheme at par with M/s. Gravo Prints, the latter
being alleged to be a defaulter but being given a special favour by the
authorities in respect of the self-same industrial estate as the present
one. Upon interpreting the language of the concerned Circulars floating
the Scheme-in-question, it was held that in the case of beneficial
legislations and/or Schemes, the interpretation of widest amplitude, to
advance the purpose of the legislation or the Scheme, should be given so
as not to restrict the same.
2
Continental Chemical Corporation v. West Bengal Small Industries Development
Corporation Limited and Ors. (WPA No. 183 of 2024)
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34. It is further pointed out that the appellants themselves offered to renew
the lease deed upon payment of Rs. 30 lakh per Cottah, as recorded by
the learned Single Judge in the order dated September 21, 2023. By
doing so, it is argued that the appellants gave up their right to evict the
respondent nos. 1 and 2. It is submitted that it was the incumbent duty
of the appellants to consider the application of the respondent no. 1 for
getting the benefit of the Scheme and to give such benefit to the said
respondent upon compliance of due formalities. In the case of M/s.
Gravo Prints, it is submitted that its lease had also expired long back in
1992 and an eviction order was passed, which had been stayed. M/s.
Gravo Prints was also defaulter and in its case, it was agreed by the
appellants that it would withdraw all the legal cases to get the benefit of
the Scheme, therefore, contemplating future withdrawal post-application
as a valid mode of granting the benefit of the Scheme. Even in the said
case, M/s. Gravo Prints was given opportunity to pay the arrear rents
later. Thus, the argument of non-applicability of the Scheme to the
present respondent no. 2 is not a valid contention.
35. Accordingly, it is submitted that the learned Single Judge was justified in
passing the impugned judgment and the same ought not to be interfered
with in appeal.
36. Considering the arguments of the parties and in the light of the materials
placed before the Court, it transpires that the present adjudication
hinges on the following issues:-
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(i) Whether respondent no. 1 is entitled in law to the renewal of its
tenancy;
(ii) Whether respondent no. 1 is entitled to the benefit of the Scheme
dated February 18, 2021, subsequently extended on August 25,
2022;
(iii) Whether there is any violation of Article 14 of the Constitution of
India against respondent nos.1 and 2;
(iv) Whether there was any legal malice in the impugned action of the
WBSIDCL.
37. The said issues are decided as follows:
(i) Whether respondent no. 1 is entitled in law to the renewal of
its tenancy
38. Admittedly, the lease granted to respondent no. 1 in respect of the
subject-plots on June 8, 1989 expired by efflux of time on August 8,
1998.
39. A notice under Section 3(1) of the 1976 Act was also given to respondent
nos. 1 and 2. The effect of such notice was to terminate the tenancy,
since sub-section (1) of Section 3 provides that every tenancy held by a
tenant in respect of a Government premises shall stand terminated upon
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the expiry of the period referred to in a notice to quit served upon such
tenant in the prescribed manner.
40. Hence, there cannot be any manner of doubt that the tenancy of
respondent no.1 stood expired, both by efflux of time and upon issuance
of the notice under Section 3(1). The renewal of lease under the 1976 Act
is governed by the first three provisos under Section 3(2) of the said Act
as well as Rule 5 of the West Bengal Premises (Tenancy Regulation)
Rules, 1976 (for short, “the 1976 Rules”).
41. Section 3 of such Act is reproduced for convenience below:
“3. (1) Every tenancy held by a tenant in respect of a Government premises shall
stand terminated upon the expiry of the period referred to in a notice to quit
served upon such tenant in the prescribed manner.
(2) A tenancy in respect of a Government premises shall stand automatically
terminated without any notice to quit where the tenant has,–
(ia) subsequently built a house or acquired (by purchase, gift, inheritance, lease,
exchange or otherwise) a house or an apartment, either in his own name or in the
name of any member of his family, within a reasonable distance from such
Government premises.
Explanation.–For the purposes of this section and section 3A,–
(a) “appartment” shall have the same meaning as in the West Bengal
Apartment Ownership Act, 1972;
(b) “family” shall include parents and other relations of the tenant who
ordinarily reside with him and are dependant on him;
(c) “reasonable distance” shall mean any distance not exceeding twenty-
five kilometers, or
(ii) made default in payment of rent for three consecutive months:
Provided that where the tenancy has terminated on account of default in
payment of rent for three consecutive months the prescribed authority may,
upon application made by the tenant within such time as may be prescribed
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and upon deposit of all the arrears of rent together with interest at the
prescribed rate, grant renewal of the tenancy in favour of the tenant:
Provided further that the prescribed authority may, on sufficient
cause being shown, grant renewal of the tenancy in favour of the tenant on
deposit of fifty per cent of the arrears of rent along with the application for
renewal of tenancy and direct the tenant to deposit the balance of the arrears
of rent with interest on the entire amount at the prescribed rate in twelve
monthly installments commencing from the month following the month of such
renewal of tenancy, and if the tenant fails to deposit any such installment the
tenancy so renewed shall stand automatically terminated:
Provided further that the prescribed authority may, if it is satisfied
that the tenant has failed to pay rent due to circumstances beyond his control
and is not in a position to deposit fifty per cent of the arrears of rent along
with the application for renewal of tenancy, grant renewal of the tenancy in
favour of the tenant on deposit of twenty-five per cent of the arrears of rent
along with the application for renewal of tenancy and direct the tenant to
deposit the balance of the arrears of rent with interest on the entire amount
at the prescribed rate in such number of monthly instalments, not less than
twelve and not more than thirty six, as the prescribed authority may consider
reasonable, commencing from the month following the month of such renewal
of tenancy, and if the tenant fails to deposit any such instalment, the tenancy
so renewed shall stand automatically terminated:
Provided also that notwithstanding the termination of the tenancy
the State Government or the Government undertaking, as the case may be,
shall be entitled to recover all arrears of rent for the period for which the
tenancy subsisted and mesne profits thereafter for so long as the tenant
remained in occupation of the premises.
(3) (a) Where any Government premises allotted to a tenant remains under
lock and key for a period of more than three consecutive months or where the
tenant or any member of his family is not ordinarily resident of such
Government premises, the tenancy in respect of such Government premises
shall stand automatically terminated:
Provided that if the prescribed authority is satisfied that the
circumstances, under which such Government premises remains under lock
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and key for more than three consecutive months or the tenant or any member
by his family is not ordinarily a resident of such Government premises, are
beyond the control of the tenant, it may allow the tenancy to subsist:
Provided further that the prescribed authority shall give the tenant
a notice and an opportunity of being heard before such termination:
Provided also that an appeal shall lie to the Appellate Authority
against an order determining non-occupation for a period of three consecutive
months or non-residence by the tenant or any member of his family under the
above provisos within fifteen days from the date of the order passed by the
prescribed authority and, in such case, the decision of the Appellate Authoirty
shall be final.
(b) A tenant shall be deemed to be ordinarily resident of a
Government premises if he or any member of his family generally resides in
such Government premises for not less than ninety days in a period of four
consecutive months.
(c) The provisions of this sub-section shall have effect
notwithstanding anything contained in this Act or in any other law for the
time being in force or in any instrument having effect by virtue of any law
other than this Act, or in any decree or order of any court, tribunal or other
authority, and nothing contained in the Transfer of Property Act, 1882, or the
Indian Contract Act, 1872, or the West Bengal Premises Tenancy Act, 1956,
shall apply, or shall be deemed over to have applied, to the tenancy as
aforesaid and such tenancy shall take effect, and shall be deemed always to
have taken effect, as if the Transfer of Property Act, 1882, or the Indian
Contract Act, 1872, or the West Bengal Premises Tenancy act, 1956, had not
been passed.”
42. No dispute has been raised by the respondent nos. 1 and 2 as to the
respondent no. 1 being a defaulter in payment of rent when the eviction
order was passed. Each of the first three provisos to Section 3(2)
stipulates an application to be filed within the prescribed time and
simultaneous deposit of arrears of rent, together with interest at the
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prescribed rate, as a pre-condition for renewal of the lease. Section 2(d)
of the 1976 Act defines “prescribed” as prescribed by Rules made under
the said Act, thus referring to the 1976 Rules.
43. Rule 5(1) of the said Rules stipulates the prescribed period to be one
month from the date on which the tenancy stands terminated on
account of default in payment of rent for three consecutive months and
Rule 5(2) reiterates that all such applications shall be accompanied by
deposit of all arrears of rent together with interest at the prescribed rate.
The use of the term “shall” makes it mandatory for such deposit to be
made simultaneously with the application. Sub-rule (3) of Rule 5
provides that the rate of interest to be charged an arrear of rent shall be
such as may be notified by the State Government from time to time.
44. In the present case, there is no evidence on record to show that the
respondent no. 1 made any application for renewal of its tenancy at any
point of time, let alone depositing the arrear rents with interest along
with the same. Although learned counsel for the respondent nos. 1 and 2
tries to impress upon the court that the request dated May 5, 2014 made
by respondent no. 1 to the appellants for issuance of monthly rent bills
tantamount to expression of interest for renewal, we are unable to agree
with such contention. In the said request, we do not find any whisper or
intention to renew but merely the assertion that monthly rent bills ought
to be issued to the respondent no. 1.
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45. Thus, this Court comes to the finding that the respondent nos. 1 and 2
were not entitled to renewal of the lease granted in favour of respondent
no. 1 under the provisions of the 1976 Act or the 1976 Rules.
46. Another aspect of the contesting respondents‟ arguments is that the
1976 Act being a beneficial piece of legislation, the provisions
enumerated in the provisos to Section 3(2) of the said Act ought to be
given liberal interpretation, by drawing analogy from the provisions of
the West Bengal Premises Tenancy Acts of 1956 and 1997, as
incorporated respectively in Section 17 and section 7 thereof.
47. However, the said argument is not tenable in the eye of law. The premise
of the provisions of Section 3 of the 1976 Act stands on an entirely
different footing than that of the Rent Control laws mentioned above.
Under the 1956 and 1997 Acts, an additional layer of protection has
been given to tenants, who have previously committed default in
payment of rent, in a suit for eviction instituted against them, to afford a
second opportunity to pay the arrear rents before they are ultimately
evicted. However, the provisions of the 1976 Act, although beneficial to
some extent, are more rigorous than the Rent Control Laws inasmuch as
Government premises have been treated on a different footing than other
premises, apparently due to administrative exigencies and the public
interest element involved in dealing with such premises. Some amount of
exigency in the eviction process with regard to Government premises is
inbuilt in the 1976 Act, insofar as no eviction proceeding is contemplated
thereunder prior to eviction, unlike the Public Premises (Eviction of
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Unauthorised Occupants) Act, 1971. Upon an order being passed under
Section 3(1) of the 1976 Act, the tenancy stands terminated
automatically by operation of Section 3(2) thereof.
48. As per the scheme of the 1976 Act, a mere notice under Section 3(1)
would suffice to terminate the tenancy outright upon the expiry of the
notice period. Sub-section (1) of Section 3 itself provides so, which is
further bolstered by sub-section (2), which stipulates that a tenancy in
respect of a Government premises shall stand “automatically terminated”
without any notice to quit where the tenant has violated any of the
subsequent provisions, including making default in payment of rent for 3
consecutive months.
49. Section 4 of the 1976 Act is only a post-termination exercise and does
not even require any further notice to be given to the tenant by the
Government authorities. Sub-section (1) of Section 4 provides that upon
termination of a tenancy under any of the provisions of Section 3, the
tenant “shall forthwith restore vacant possession” of the premises
occupied by him in favour of the prescribed authority. Sub-Section (2) of
Section 4 stipulates that if the tenant fails to so restore, the prescribed
authority or any officer authorized by him in this behalf “may take such
steps or use such force” as may be necessary to take possession of the
premises and “may also enter into such premises” for the aforesaid
purpose.
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50. Thus, the provisos to section 3(2), which are subservient to the main
provision stipulated therein, cannot be equated with the benefits given
under Sections 7 and 17 of the 1997 and 1956 Acts respectively.
51. Moreover, the first three provisos to Section 3(2), read with Rule 5 of the
1976 Rules, mandatorily contemplate an application to be made by the
tenant, along with deposit of all arrears of rent together with interest at
the prescribed rate, as a precondition for attracting the said provisos.
52. That apart, even after such application is made, an element of discretion
is left to the authorities since the term “may” has been used to qualify
the grant of renewal of the tenancy. Such discretion is, by its very
nature, restrictive insofar as the first proviso is concerned. However,
there is more scope of exercise of discretion and decision-making by the
prescribed authority in the situations envisaged in the second and third
provisos. The second proviso stipulates that such renewal of tenancy will
be made on deposit of 50 per cent with the application, provided
“sufficient cause” is shown. Again, the third proviso envisages that such
renewal may be granted if the Prescribed Authority “is satisfied that the
tenant has failed to pay rent due to circumstances beyond his control
and is not in a position to deposit 50 per cent”, upon deposit of 25 per
cent at the outset and thereafter in terms of the instalments provided in
the said proviso.
53. Due to the above reasons, no manner of analogy can be drawn between
the provisions of the Rent Control laws and those of the proviso to
22
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Section 3(2) of the 1976 Act insofar as the protection given to tenants is
concerned.
54. Thus, this Court comes to the finding that the respondent nos. 1 and 2
were not entitled to renewal of the lease granted in favour of the
respondent no. 1 under the provisions of the 1976 Act or the 1976 Rules,
in view of the said respondents having not complied with the mandatory
prerequisites for such grant of renewal as envisaged in the said
provisions.
(iii) Whether respondent no. 1 is entitled to the benefit of the
Scheme dated February 18, 2021, subsequently extended on
August 25, 2022
1. The Scheme-in-question was floated vide Circular No.
SB-1/2836/10/2020-21 dated February 18, 2021 and further extended
for 180 days vide Circular No. SB/1/1468/2022-23 dated August 25,
2022. Contrary to the contention of the appellants, the respondent no.1
had made an application for grant of the benefit of the Scheme to it
within the extended period of 180 days, on January 10, 2023 to be
precise. Thus, it cannot be said that the benefit of the Scheme could not
be granted to respondent no. 1 due to delay in making the application.
2. The next ground of objection of the appellants to the extension of such
Scheme to the respondent no.1 is that the latter was not an “existing
allottee” at the relevant juncture.
23
2026:CHC-AS:445-DB
3. The concept of „existing allottee‟ has been explained at length in
Continental Chemical Corporation (supra)3. The scope of the said
expression was elaborated in the said report to include both lessees and
non-lessee allottees. The provisions of the original Scheme, contained in
the minutes of a meeting dated October 13, 2020, was discussed in the
said judgment and held to be a special Scheme for “old and existing
entrepreneurs of Behala Industrial and Commercial Estate”. Hence, the
purpose of the Scheme was to extend the benefit of renewal and
conversion of short-term lease to long-term lease to the existing
entrepreneurs operating in the said industrial estate. Such Scheme was
modified on February 18, 2021, referring to the 359th meeting of the
WBSIDCL held on February 10, 2021, in which it was decided to launch
a special scheme for “conversion of lease from short-term to long-term in
respect of the existing allottees of Behala Industrial and Commercial
Estate”.
4. Since both the expressions, “allottees” and “lease”, were used in the
aforesaid Circulars, the purpose of the Scheme was interpreted to
include all allottees in respect of the industrial estate. In fact, there is a
marked difference between “existing allottees” and “existing lessee”.
Whereas the former expression has been used in the Scheme, the latter
has been deliberately avoided, thereby expressing the clear intention of
the Scheme to make its benefits available to all allottees who were in
3
Continental Chemical Corporation v. West Bengal Small Industries Development
Corporation Limited and Ors. (WPA No. 183 of 2024)
24
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possession of the subject-plots at the relevant juncture, making such
consideration independent of the criterion of whether any lease subsisted
or was ever granted to such allottee at all. Such divergence of the
notions of „allottee‟ and „lessee‟ in the Scheme itself clearly mandates that
irrespective of the subsistence of a valid lease, the benefit of the Scheme
could be availed of by any allottee on the plots within the estate. There
cannot be any doubt that at all relevant points of time the present
respondent no.1 was an allottee, having the further protection of a lease,
although the latter protection expired subsequently.
5. Hence, the benefit of the Scheme has to be interpreted to be available to
the respondent no.1 as well, in the capacity of an existing allottee in the
sense that it was still in occupation of the subject-plots at the relevant
juncture as an allottee of an industrial plot for the purpose of carrying
out its industrial activities in the capacity of an entrepreneur.
6. Moving on to the conditions as envisaged under the Scheme, the very
language of the Scheme indicates that the arrears could be cleared and
pending litigation could be withdrawn even after the application for
availing the benefits of the Scheme being made. There is nothing in the
Scheme to show that such payment of arrears and non-pendency of
litigation was a pre-condition of even making an application for getting
the benefit of the Scheme. Moreover, by its very nature, the condition of
withdrawal of litigation and payment of all arrears, particularly the
former, cannot precede the making of an application, since, in the event
the benefit of the Scheme being refused to the applicant after
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withdrawing all litigation, the applicant would be remediless against the
WBSIDCL. Such a situation cannot be contemplated under a beneficial
Scheme, which the 2020 as well as the 2021 Scheme evidently are.
Accordingly, such argument on the part of the appellants has also to be
turned down.
7. The court cannot overlook the fact that, albeit in terms of the different
orders of the Appellate Authority and the court, the respondent nos.1
and 2 had paid all arrears as quantified by the appellants themselves
before such Authorities/courts at different points of time, which would
be evident from the different orders placed this court. The appellant-
authorities also accepted such amounts from the respondent no.1.
Although mere acceptance of rent does not confer the status of a tenant
to a defaulter otherwise, whose tenancy has already expired, nor can it
be construed as an automatic renewal of the lease, insofar as the
Scheme-in-question is concerned, the payment of all arrears at every
point of time, in terms of the calculations made by the appellants
themselves, can definitely be construed to be substantial compliance of
the terms of the Scheme regarding payment of all arrears.
8. In fact, the appellants themselves had given out that they had no qualms
to renew the lease of the respondent no.1 subject to payment of an
amount of Rs.30,00,000/- per cottah, as recorded in the order dated
September 21, 2023. Hence, the appellants are evidently not averse to
such renewal or granting the benefit of the Scheme to the respondent
no.1, subject to fulfilment of all necessary conditions. The amount of
26
2026:CHC-AS:445-DB
Rs.30,00,000/- per cottah is definitely a ballpark amount, in the absence
of any disclosure of the breakup or basis thereof. However, the
agreement of the appellants in principle to give the benefit of the Scheme
to the respondent no.1 was evident by such offer itself.
9. Thus, this issue is decided in favour of the respondent nos.1 and 2, since
the respondents are eligible for getting the benefit of the Scheme-in-
question.
(iii) Whether there is any violation of Article 14 of the Constitution
of India against respondent nos.1 and 2
10. Respondent nos.1 and 2 have drawn analogy from similar benefit of the
Scheme being given to one M/s. Gravo Prints. The appellants seek to
distinguish between the attending circumstances of the two cases on
several grounds. However, such grounds are merely illusory and
superficial distinctions and cannot afford a reasonable basis of
discriminating between the respondent no.1 in the present case and
M/s. Gravo Prints.
11. As discussed in Continental Chemical Corporation (supra)4 in respect of
M/s. Gravo Prints as well, its lease had expired long back and it was also
a defaulter in payment of rent. M/s. Gravo Prints was granted liberty to
deposit the arrears of rent subsequent to its application to come under
4
Continental Chemical Corporation v. West Bengal Small Industries Development
Corporation Limited and Ors. (WPA No. 183 of 2024)
27
2026:CHC-AS:445-DB
the Scheme and was treated to be an existing allottee for the purpose of
the Scheme despite its lease having already been terminated previously.
12. M/s. Gravo Prints had deposited the arrears of rent as claimed. The
respondent no.1 in the present case has also deposited arrears of rent as
per the calculation of the appellant-Authorities, in terms of the
submissions made by the appellants in court, at various points of time.
13. Moreover, despite the respondent no.1 having specifically applied for
getting the benefit of the Scheme within the extended period of 180 days
as per the second Circular, such application was not decided at all by
the appellant-authorities at any point of time. Unless the same was
decided and an opportunity was given to the respondent no.1 to deposit
all arrears and to withdraw pending litigation, which opportunities were
given to M/s. Gravo Prints, it could not be said that the present
respondent no.1 was treated on equal footing as M/s. Gravo Prints or
that there was no discrimination between the two.
14. It is trite law that a Government Scheme is in the nature of a benefit and
a privilege and no automatic right as such to get such benefit is
conferred on an eligible applicant. However, once such privilege is
granted to an entity, all other entities standing on similar footing
automatically acquire a right to get similar treatment from the State.
After all, it is more than well-settled that State action (even in
contractual matters) has to stand on a much higher pedestal than that of
an individual citizen and cannot be manifestly discriminatory or
arbitrary.
28
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15. Tested on such anvil, it is clear that the appellant no.1, which comes
within the ambit of Article 12 of the Constitution of India, discriminated
between the respondent no.1 and M/s. Gravo Prints and other similar
entities which were given the benefit of the Scheme, in a patently
arbitrary manner, without any rationale.
16. The facts of Deepak Kejriwal (supra)5 and Gulsan Kumar Gulati (supra)6
are not applicable to the present case since in the former, the subject-
matter of allegation was a challenge to the Circular dated August 18,
2022 and fixation of the arrear rents in the facts of the cases, in which
context it was held that mere acceptance of occupation charges does not
tantamount to automatic renewal of the lease and that the respondents
therein had never agreed to the rent proposed by the writ petitioner in
the former case, whereas in the latter, the applicability of the Scheme-in-
question was not under consideration but a challenge to the jurisdiction
of the authorities to pass an eviction order was raised on the ground that
subject-plots were not “Government premises” under the 1976 Act,
which was turned down by the Court on the grounds mentioned in the
judgment.
17. Accordingly, it is held that the fundamental right of equality guaranteed
under Article 14 of the Constitution of India, which was available to the
respondent nos.1 and 2, was violated by the impugned action of the
appellants.
5
Deepak Kejriwal v. The State of West Bengal and others (WPO No. 518 of 2013)
6
Gulsan Kumar Gulati and Another v. West Bengal Small Industries Development
Corporation Limited and others (WPO No. 1610 of 2023)
29
2026:CHC-AS:445-DB
(iv) Whether there was legal malice in the action of the WBSIDCL
18. The tests of „legal malice‟ were laid down in Paragraph Nos.12 to 14 of
Goverdhanlal Pitti (supra)7. The contents of the said paragraphs are set
out verbatim below:
“11. The last submission made is that since the school building
was in a dangerous condition and the school having been already shifted
at an alternative site, this Court in exercise of its power under Article 136
of the Constitution of India should refuse to interfere in the order of the
High Court. In the alternative, it is prayed that the State Government be
directed to reconsider its decision for retaining the school building as the
school stands shifted to a new location.
12. The legal meaning of malice is “ill-will or spite towards a
party and any indirect or improper motive in taking an action”. This is
sometimes described as “malice in fact”. “Legal malice” or “malice in law”
means “something done without lawful excuse”. In other words, “it is an
act done wrongfully and wilfully without reasonable or probable cause,
and not necessarily an act done from ill feeling and spite. It is a
deliberate act in disregard of the rights of others”. (See Words and
Phrases Legally Defined, 3rd Edn., London Butterworths, 1989.)
13. Where malice is attributed to the State, it can never be a case
of personal ill-will or spite on the part of the State. If at all it is malice in
legal sense, it can be described as an act which is taken with an oblique
or indirect object. Prof. Wade in his authoritative work on Administrative
Law (8th Edn., at p. 414) based on English decisions and in the context of
alleged illegal acquisition proceedings, explains that an action by the
State can be described mala fide if it seeks to “acquire land” “for a
purpose not authorised by the Act”. The State, if it wishes to acquire land,
should exercise its power bona fide for the statutory purpose and for none
other.
7
State of A.P. and others v. Goverdhanlal Pitti, reported at (2003) 4 SCC 739
30
2026:CHC-AS:445-DB
14. Legal malice, therefore, on the part of the State as attributed
to it should be understood to mean that the action of the State is not
taken bona fide for the purpose of the Land Acquisition Act and it has
been taken only to frustrate the favourable decisions obtained by the
owner of the property against the State in the eviction and writ
proceedings.”
19. As per the above ratio, there could not be any element of personal ill-will
or spite when an allegation of legal malice is levelled against the State.
Such malice has to be in the legal sense, described to be an act which is
taken with an oblique or indirect object. Although, in the said case, the
possession of the land was taken de hors the purposes of the Land
Acquisition Act and to frustrate favourable decisions which had already
been obtained by the owner of the property against the State in eviction
and writ proceedings, which circumstances are not directly applicable
here, legal malice is manifest in the present case on a somewhat different
footing.
20. The first ingredient of legal malice can be found in the deliberate action
on the part of the appellants to thwart the outcome of the writ petition,
being W.P.A. 22402 of 2023. On the very date when it was filed, the
appellants took over possession of the subject-plots by evicting the
respondent nos.1 and 2, despite being fully aware of and being served
with a copy of the writ petition. No doubt, the appellants had previously
passed the second resumption order under Section 4(2) of the 1976 Act
on July 19, 2023 and had given a notice to the respondent nos.1 and 2
on September 11, 2023, fixing September 14, 2023 (11:00 AM) as the
31
2026:CHC-AS:445-DB
date of taking possession, yet, after coming to know that a writ petition
had been filed and would be taken up for hearing at 02:00 PM on the
self-same day, it was a manifest attempt on the part of the appellant-
Authorities to frustrate the outcome of the said challenge by going ahead
with the dispossession of the respondent nos.1 and 2 in the teeth of such
pendency, in spite of the concerned Bench having expressed its intention
to take up the matter at 02:00 PM on the same day, without awaiting the
outcome of such motion.
21. Even earlier, the appellant had hastened to pass a second resumption
order on July 19, 2023, soon after the previous writ petition bearing
W.P.A. No. 4280 of 2014 was dismissed for default on June 21, 2023.
The appellants were fully aware that throughout the pendency of W.P.A.
No. 4280 of 2014, there was a subsisting order restraining the appellants
from evicting the respondent nos.1 and 2. Thus, taking advantage of the
dismissal of the said matter for default and the consequential vacating of
the said restraint order, a second notice of resumption was given by the
appellants in hot haste, before the respondent nos.1 and 2 could take
steps for restoration of their earlier application.
22. The above modus operandi of the appellant-authorities reeks of palpable
legal malice, which is manifest in the attempt of the appellants to eschew
the legal challenge thrown to the attempted resumption by preferring a
writ petition before this Court and, despite a restraint order subsisting
all throughout the pendency of the previous writ petition, hurrying to
resume possession immediately after it was dismissed for default, in a
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bid to deprive the writ petitioners/respondent nos.1 and 2 of the
opportunity to have the previous writ petition restored, along with the
previously subsisting restraint order.
23. Hence, this Court comes to the conclusion that “due process of law” was
paid mere lip-service of the appellant-authorities, in spirit violating the
cardinal tenets of natural justice and fair process. The element of
“fairness” must be read into “due process” for the said term to have any
meaningful application within the Constitutional Scheme of India and
the two cannot exist without each other.
24. Tested on such anvil, the impugned actions of the appellants were
tainted by legal malice and were rightly set aside by the learned Single
Judge.
CONCLUSION
25. In view of the above findings, this Court comes to the conclusion that the
learned Single Judge was justified in passing the impugned judgment,
thereby directing possession to be restored to the respondent nos.1 and
2 and the benefits of the Scheme under the Circular dated February 18,
2021, as extended on August 25, 2022, to be given to the writ
petitioners/respondent nos.1 and 2 in respect of the subject-plot nos. K-
10 and K-10/2 in the Behala Industrial Estate at 620, Diamond Harbour
Road, Kolkata – 700 034.
26. Accordingly, M.A.T. No.1694 of 2024 and M.A.T. No.1695 of 2024 are
dismissed on contest, thereby affirming the impugned judgment dated
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August 16, 2024 passed in W.P.A. No.22402 of 2023 and W.P.A. No.4280
of 2014.
55. Consequentially, the pending applications in the appeals, both bearing
CAN 1 of 2024, stand disposed of as well.
56. There will be no order as to costs.
57. Urgent certified copies, if applied for, be supplied to the parties upon
compliance of all formalities.
(Sabyasachi Bhattacharyya, J.)
I agree.
(Supratim Bhattacharya, J.)